{"id":936,"date":"2011-01-18T05:57:13","date_gmt":"2011-01-18T10:57:13","guid":{"rendered":"http:\/\/www.holypotato.net\/?p=936"},"modified":"2011-01-18T06:10:07","modified_gmt":"2011-01-18T11:10:07","slug":"mortgage-amortizations","status":"publish","type":"post","link":"https:\/\/www.holypotato.net\/?p=936","title":{"rendered":"Mortgage Amortizations"},"content":{"rendered":"

First up, the 5th edition of the Canadian Real Estate Blog Carnival<\/a> is up on Landlord Rescue.<\/p>\n

In the news today, the government tweaked mortgage lending rules slightly, reducing the maximum insured amortization to 30 years, maximum refinance LTV to 85%, and removed government insurance for HELOCs.<\/p>\n

The various financial forums are still discussing the HELOC issue — I’m not sure myself how many HELOCs were actually insured, so it’s probably a minor issue. Refinances should likewise be a small piece of the pie. So that leaves the reduction in amortization. On the one hand, this is something that will influence almost every first-time buyer, as huge swaths of that section of the population have been opting for the maximum amortization to grab as much RE as they could. I myself would have preferred an increase to the minimum down-payment at the same time, but we’ll take what we can get. What’s the impact? Very briefly, if someone had a maximum mortgage budget of $1000, then:<\/p>\n

At 35 years, they could get a $260k mortgage at 3%, or $198k at 5%. With the new 30 year maximum amortization, that same $1000 monthly budget gets $237k at 3%, and $187k at 5%. The effect is interest-rate dependent, but it means that for someone at the very edge of affordability, their maximum house price just went down something like 5-9%. Not a huge effect, but hopefully something to get the ball rolling.<\/p>\n","protected":false},"excerpt":{"rendered":"

First up, the 5th edition of the Canadian Real Estate Blog Carnival is up on Landlord Rescue. In the news today, the government tweaked mortgage lending rules slightly, reducing the maximum insured amortization to 30 years, maximum refinance LTV to 85%, and removed government insurance for HELOCs. The various financial forums are still discussing the […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[20],"tags":[],"_links":{"self":[{"href":"https:\/\/www.holypotato.net\/index.php?rest_route=\/wp\/v2\/posts\/936"}],"collection":[{"href":"https:\/\/www.holypotato.net\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.holypotato.net\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.holypotato.net\/index.php?rest_route=\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.holypotato.net\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=936"}],"version-history":[{"count":0,"href":"https:\/\/www.holypotato.net\/index.php?rest_route=\/wp\/v2\/posts\/936\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.holypotato.net\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=936"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.holypotato.net\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=936"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.holypotato.net\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=936"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}